Abstract: With the increase of DGs in distribution networks, management of this systems are faced with new challenges. A proposed method for the management of these systems is using Microgrids. A Microgrid is a set of distributed generation and load which acts as a large source or load in view of main grid. On the other hand, the fault current level exceeds the short-circuit capacity of network equipment by microgrids connection. To overcome this problem, fault current limiter (FCL) could be located between the main network and microgrid. So in this paper a typical distribution network with a connected microgrid has been simulated in the Matlab / Simulink, and then the most severe type of the faults execute in two different locations on the network. Various cases are surveyed and the impact of the FCL on the fault current and voltage sag of the microgrid at the junction with the main network (PCC) has been studied. The obtained results show FCL functionality to increase reliability and improve power quality of microgrid.